Miami Beach Residential Blog

Home buying, regardless of how intricate it can become is essentially a more up to date form of the system merchants used in the past to sell their goods: bartering. The consumer (or buyer in this case) wants to pay as little as possible and yet the seller is looking for the biggest profit possible. All this haggling would be a lot easier for both parties involved if the real estate market were in better conditions and South Florida homes were still in hot demand which, as everyone knows, isn’t quite the case.

Although one person is looking for more and the other is seeking less, there is a mutual goal: agreeing on a suitable price. While the seller has their own research to do, buyers should do a little bit of problem solving homework before putting an offer on the table.

Owning Miami Beach oceanfront condos often gives owners a sense of entitlement, especially when it comes to determining how much they can ask for it when it’s time to sell. A couple of years ago, an inflated price would be okay but it’s a different climate. If a seller’s initial asking price seems ridiculous, chances are other buyers feel the same so allow some time for the price to come down but do make sure the seller is aware of your interest. Assuming you’re using the services of a real estate agent, they can do this on your behalf and act as the intermediary once the price is reduced to something more agreeable.

The less fellow buyers involved, the better your chances of throwing out competitive numbers to achieve your ideal price. Refrain from giving the exact price you’re aiming for. Instead raise or lower or the amount in order to allow yourself room to bargain without having to sacrifice too much which simultaneously allows the seller to feel as if they’re getting something out of the deal.

If someone else has offered a price you know you can’t match, all hope is not lost. Sellers appreciate it when buyers choose to take on additional costs normally the responsibility of the seller so if you can pay for some of these, there is a very good chance a seller will accept your slightly higher proposal over someone else who offered less.

South Beach condo residents should be especially happy around this time of year now that the summer season is closing in. What does that mean? More time sunbathing on the glistening sands of Miami Beach, having lunch at al fresco cafes on Ocean Drive and checking out the upcoming and regularly held events in the city and nearby.

At the Jackie Gleason Theater, none other than political satirist Bill Maher brings his signature brand of often controversial humor to the venue on May 6. Anyone who enjoyed his shows “Politically Incorrect” and his HBO show “Real Time with Bill Maher” will want to check out his upcoming performance.

Some people may not be aware of it but every Friday at The Fifth, the 400 Club party takes place and is usually frequented by individuals both young and still youthful looking for something to do in South Beach when the workday is over and the weekend begins. The party is known to be frequented by several prominent athletes and big name celebs.

Mother’s day is just around the corner. Have you decided what you’re going to do yet? The Brazilian steakhouse of Texas de Brazil will be having a special one day only menu to celebrate the occasion, be sure to reserve a table now if you’re interested.

For music aficionados, the JVC Jazz Music Festival will be taking place at the Raleigh Hotel Restaurant on the sixteenth and seventeenth of May, featuring both established and up and coming artists like DJ Rainer Truby and Yoruba Soul Orchestra.

Whether you decide to venture beyond the perimeter of Miami Beach to explore the host of activities and events taking place in Coconut Grove, Coral Gables and downtown Miami, rest assured that the upcoming summer season will bring plenty to see and do close to your South Beach home.

In one’s lifetime, there comes that point when the thought of buying your first home begins to manifest itself. Alas, buying South Florida homes these days is something many will advise against due to the uncertain status of the real estate market. Yet there are those people who will tell you the complete opposite and passionately explain to you why buying in the current inventory of property for sale is actually wise.

With conflicting opinions and advice coming from both sides, it’s easy to be intimidated by the home buying prospect. You may be thinking, “Okay, I really want a Miami Beach condo by the water to call my own so…should I buy a home right now or not?”

Any real estate agent well-informed in Miami Beach real estate and/or the industry itself will explain to you that during tricky market times such as these, the decision doesn’t come down to an easy yes or no answer. Those people who may have told you that you will be losing money if you buy are indeed correct. Whatever you choose to pay now, you could pay less for in a few months. Also, due largely to the mortgage and foreclosure issue, lenders are playing hardball with borrowers and have become quite selective about who they lend to.

Then again, the prospects could be extremely worthwhile. For one, property prices have gone done considerably which should bring you closer to obtaining that four bedroom home in Miami Beach you’ve always wanted and interest rates on mortgages have gone down which should translate to a more affordable monthly mortgage payment, particularly if you’ve maintained an outstanding credit history.

It can be safely assumed then that there is no real right or wrong when it comes to buying a home. Yes you will lose money and this is something you need to be able to deal with before you do anything else. Sometimes however, it’s not so much the money that matters as it is finding a home to call your own.

Over the past few months I’ve noticed, especially in social environments, one of the first topics that comes up is the state of the real estate market. Usually, one of the first questions I get asked is “how’s it going?” sometimes with an expression of concern. I’d like to take this opportunity to relay my response here:

The national news media and overall real estate economic statistics are dire, and getting worse on a seemingly daily basis. The truth is that the real estate market boom was overextended and very much speculative based (as opposed to need and/or value based). These current market conditions were not a surprise to me or to anyone who has been in the business through previous market cycles. Essentially, I’m the middleman in real estate transactions, I think a very valuable middleman, but nevertheless a third party to a real estate transaction. I’ve witnessed many dire situations in the past few months where owners have lost all of their equity and stubbornly clung to unrealistic prices - ultimately losing control of properties to the bank or other creditors.

I work for one of the largest and strongest local real estate companies, and yet I’ve noticed that around my office the number of active agents has dwindled. The ones that are left are those consistently ranked over the years as “Top Producers”. These real estate sales professionals are not one, two, three or even four “deal wonders” but those that have the discipline, work ethic, business and organizational skills, as well as the experience to provide value-added services to their clients. Market conditions honestly make an impact on how we work on a daily basis- in a buyer’s market the skills I just mentioned become MUCH more important.

So, my response to the casual question “How’s it going?” is- it’s a challenge, an exciting challenge that makes all of us so called “Top Producers” reach deep down inside ourselves and our skills to make sure we have the discipline in guiding both buyers and (especially) sellers to “get real” and make informed decisions. Deals are still getting done, there are many foreign as well as local buyers making offers and closing on properties. However, everyone today knows that this is a buyer’s market (especially the Greater Miami area and even the coveted South Beach market). A seller today must start by pricing aggressively and working with a qualified real estate sales professional. In the past ten days, I have personally written four sales contracts/offers totaling over six million ($6 Million) for a combination of both commercial and residential properties. The one thing these had in common: all were priced right, in very good locations, and were being handled by competent real estate sales professionals that know how to present the properties to qualified buyers and their agent (me).

I’ve noticed that contracts take longer to close, and negotiations are longer and more protracted with financial underwriting departments looking much more carefully at each and every loan application. The value equation HAS to be present today and for the foreseeable future- the latest evidence of this are the headlines from newspapers indicating a pending revision of national mortgage broker regulations and new stricter national underwriting standards.

So, to summarize, the real estate sales business is still healthy for “Top Producers”- those of us that have the ability to be selective with whom we work with, and for those of us that also have the discipline to stay focused and use our hard-earned skills to provide a true value-added service for our clients.

My Key to Success

· My team and I focus only on motivated sellers- those willing to do whatever it takes to sell their property.

· Working with motivated and qualified buyers-particularly those from Europe that understand the value in purchasing income producing and/or prime waterfront properties. If a buyer has the goal of purchasing for x dollars per square foot, then we set up a purchasing system until they get what they want.

· Continuously and religiously following up with creative & innovative marketing programs and then with direct buyers, cooperating agents, and interested parties on behalf of our clients.

Downtown Miami is well known for its many high rises made up of luxury condos like 50 Biscayne, office buildings and a few company headquarters. While the Four Seasons Miami Hotel may be the most expensive, fanciest and the largest, it could eventually be dethroned by a building that will truly pierce the skyline if certain local developers manage to have their way.

Designed by the renowned Kobi Karp, a pair of 1,022 foot buildings soaring over ninety stories into the Miami skyline to be known as the Empire World Towers are being planned and are notable not only for their incredible height, but also for the three “sky bridges” that connect one building to the other and are likely going to be translucent, suggesting a feeling of walking on air hundreds of feet above the ground.

Although they are expected to function as a high rise condo and/or residential property, many people might look at this and wonder why anyone would find this worthwhile considering that condo sales and Miami real estate has, overall, slowed.

The Empire World Towers still remain a massive work in progress and the developer doesn’t expect to finish the building at least until 2010, two years from now when most have concluded that real estate should be doing significantly better. Therefore, the Empire World Towers could potentially become a prime building for investors seeking their next residential property investment.

The project is still in its infancy and has yet to be approved by the Miami City Commission. Assuming it manages to clear all the red tape, Empire World Towers could be an integral piece towards reinforcing tourism in Miami. After all, people will definitely want to visit to see for themselves what would become the tallest building in Miami. Already located in one of South Florida’s finest urban communities, Empire World Towers has tons of potential.

Some people will fiercely proclaim otherwise but the truth is right now, the Miami Beach condo market caters largely to buyers and is currently at a point that it hasn’t seen in many years with some of the lowest values that are still falling, at least if the Florida Association of Realtors (FAR) are to be believed. While it may have negative consequences in terms of weakening the economy, intrepid buyers and investors can find some incredibly valuable deals.

Why is it that now a good time to buy a Miami Beach home or condo per the FAR? It’s simple, really. The glut of existing homes for sale opens up plenty of options that range from more affordable, realistic prices to reduced mortgage rates that translate to much more convenient monthly payments than what is common during better market times. Do some research and you’ll also find that renting a condo or home, especially at the present time, is nowhere near as worthwhile an option as that of actually owning a home. To a lesser but still noteworthy degree, Miami Beach and its tropical lifestyle make it a great place to live.

Another truth: houses are still among your best bets in terms of strengthening your financial security and gaining an investment that will yield long term results. Equity continues to build and therefore, so does your overall wealth. The tax perks you receive as a homeowner as opposed to renting also make a strong case for buying a home.

National Association of Realtors experts are saying that the market has dipped to about as low as it’s going to get and this year will finally start to see it slowly return to a better climate, particularly during the latter part of the year as buyers start to regain confidence, seize upon the low prices, and sales remain relatively steady. Couple this with the efforts being made by the government to spur the economy and suddenly, buying a waterfront condo or single family home doesn’t seem quite as absurd.

Downtown Miami may soon be experiencing another remodeling job that’ll give way to some notable new places to check out per fairly recent news reports. What’s more, commissioners are looking to rid themselves of existing construction debts that just may spur the creation of the Florida Marlins stadium that has been gestating idly for years.

Opinion will surely be divided but these new developments may be the catalyst that’ll once again inspire further additions in real estate hotspots like infamous Brickell Avenue and beyond. The Performing Arts Center has been one of the few exceptions to the otherwise sluggish city expansion which has done a lot to attract tourism dollars and overall revenue.

It remains quite famous for its celebrated design district but the soaring downtown skyscrapers and densely populated streets can definitely improve on the natural aesthetic. Currently in the works among the aforementioned city developments is a lush museum park. Market complications aside, discerning buyers oftentimes demand to be surrounded by lush, serene settings and such a creation may in turn spur more people to explore downtown Miami real estate.

Getting back to the Marlins Stadium, should the purported project finally get the green light, those previously mentioned tourism dollars may start to flow in. There’s an even likelier chance some of those tourists vacationing in Miami or staying at a nearby South Beach condo hotel will turn around and make a down payment on a vacation or permanent luxury home.

The last component in the proposed development is a community of affordable houses. Everyone knows the condos and residences in downtown Miami cater largely, albeit not completely to people with high incomes. This project could entice buyers who have long wanted to live near the bustling downtown area but did not have the necessary funds to afford a place there. These future developments and the small positive turn the housing market is supposed to take this year may end up doing wonders for the area.

This is my first blog post of the year, so I would like to wish everyone reading this a healthy and prosperous 2008! During my first full week back to work, I’d like to take a few moments to reflect on some of the different seller scenarios that I have most recently encountered:

Scenario #1: SHOULD HAVE SOLD LAST YEAR (Late on mortgage/tax payments, cannot continue with the fixed expenses, probably purchased property after 2003). Often characterized as a “short sale” with sale terms controlled by the lender. However, often times, the owner still gets to pick the realtor/brokerage firm.

It is critical to be priced correctly from the start, and that the marketing be handled by an experienced, knowledgeable, detail-oriented, and top producing real estate salesperson/team. This should be someone that will be aggressive AND creative in the marketing of the property (be it a home, condo, or land). It is crucial to be working with a company/agent at the top of their field, and who will be a straight talker, positive but realistic, and gives the seller a good feeling that they will follow up with any and all potential buyers. I have recently seen several of these properties in Miami Beach, that are being poorly marketed. The owners (and banks) do not realize what this is potentially costing them.

Scenario #2: NEED TO SELL (Possible health reasons, relocating, retiring, some financial pressure, misc. life circumstances).

It is critical to price the property correctly from the start. I am writing this on January 10, 2008, and have personally spoken to over twenty potential buyers over the past week (and made two offers thus far within 10% of the asking price). Looking at recently closed sales (within three months), properties that are priced to sell usually receive lots of activity and sometimes multiple offers. These also are properties that are on the market for no more than 45 days. Obviously, the marketing needs to be handled by an experienced, knowledgeable, detail-oriented, and top producing real estate salesperson/team. Shockingly, I’ve seen several properties in South Beach that fall under this category, that are being poorly represented (no return phone calls/emails, disconnected phone numbers, agents that seem to have other jobs and don’t really care anymore, as well as poor pictures and text descriptions).

Scenario #3: CASHING OUT (Opportunity for greater returns from owning something else, owner of many years, general desire to move on).

We are certainly not at the top of the market, however, certain properties still receive strong buyer interest. Examples are certain PH-type units with unique locations/views/floorplans, and waterfront turnkey showcase homes in unique locations with strong curb appeal). Yesterday, I had the opportunity to see a comparison of SE Florida property prices versus major European/Caribbean and South American markets. Property in the greater Miami area is still relatively inexpensive, and the weak dollar is attracting a large percentage of European (especially Russian), Canadian, and some South American buyers. I am finding particularly strong buyer interest in Miami Beach and especially South Beach. Island waterfront homes, and South of Fifth Street (South Beach) premium location condo buildings are especially sought after by European buyers.

A joint venture of New York City-based ING Clarion LLC and locally based Flagstone Property Group plans to begin construction in summer 2008 on Island Gardens. The $600-million, mixed-use project is rising on Watson Island in Biscayne Bay. The project is slated for completion in 2010.

The project, located on 10.5 acres of previously undeveloped land, will feature a 43-story building with the 150-room Shangri-La Hotel and fractional ownership homes, called the Residences at Island Gardens, atop the hotel. It will also feature a 29-story business hotel/resort and the 50-slip Super-Yacht Harbour; CHI, the Spa at Shangri-La; and 221,000 sf of retail and restaurant space. Watson Island is situated between Downtown Miami and South Beach and is accessible by automobile via MacArthur Causeway (Interstate 395, the extension of Interstate 95 to South Beach.)

Flagstone Property Group chairman and CEO Mehmet Bayraktar tells GlobeSt.com that marketing efforts for the fractional units have started with prices ranging from $175,000 to $750,000 for a one-eighth interest. Final discussions are under way with the operator of the hotel/resort in the 29-story tower (announced at Art Basel as the Shangri-La Hotel Group).

Bayraktar adds that the retail space is not within the towers, but in separate structures alongside the retail avenue that runs between the two towers. Marketing efforts for the retail and dining space have recently commenced and several letters of intent have been received from restaurateurs and retailers. The positioning of the retail will be high-end luxury goods.

The project, located within minutes of Downtown Miami and Miami Beach, will feature unobstructed views of Biscayne Bay and the Miami skyline. “With its potential to transform the Miami skyline, we expect the complex to become one of the premiere leisure and hospitality addresses in the city,” says ING Clarion managing director Edward Rotter, in a released statement.

The Super Yacht Harbor will be the only marina in North America to be able to accommodate mega-yachts up to 300 feet in length. A 100-foot, set-back landscaped promenade will extend along the 1,000 foot length of the sea wall. The project is being designed by London-based Eric Kuhne & Associates with interiors by Italy-based Piero Lissoni.

Hello Friends:

I would like to share an interesting and accurate story that aired throughout the day Monday on FOX News and explains that Florida is #1 of all the states in the U.S. in foreign buyers now with 26% of the market followed by California & Texas. The story specifically sites Downtown Miami & South Beach as areas attracting these buyers.

I am personally witnessing this myself as I currently have several pending deals with foreign buyers using Euros. I strongly believe that now is the time for educated buyers to come in and get some great deals on properties in PRIME waterfront locations.

Click on the picture below to have a look.